2012 Global Market report - NAI Global

Frankfurt am Main, Germany
Athens, Greece
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NAI apollo
+49 69 970 50 50
Country Data
Area (Sq Mi)
GDP Growth
GDP 2011 (US$ B)
GDP/Capita (US$)
Inflation Rate
Unemployment Rate
Interest Rate
Population (Millions)
137,882
2.0%
$3,358.24
$41,235.74
1.4%
7.1%
1.0%
81.44
As forecasted by experts in 2010, Germany is reaching
its economic strength once again. Three years after the
economic crisis, the German GDP gained a constant growth
rate between 1.5% and 2% over the last one and a half
years. At the end of 2011 the German GDP growth rate is
expected to reach its high point at 3.5%, before it returns
to a moderate level about 2% in 2012.
Other economic key factors demonstrate the recovery of the
German economy. The unemployment rate has been
consistently decreasing since 2005 (currently at 7%). This
is the lowest unemployment rate since the German reunion
in 1990. Inflation and buying power remain stable. As one
of Europe’s most important cities Frankfurt/Main is clearly
one of the main drivers responsible for this boost. Even
though it anticipates a considerable increase in its
population (from about 650,000 inhabitants in 2005 up to
about 690,000 in 2011), unemployment in Frankfurt is
sinking and currently even at 1.4% below the German
average. Another hint of the economic strength of the
city is the wealth of its inhabitants. The generated GDP
per capita in Frankfurt is almost three times higher than
the average, the buying power per capita is currently at
22,000 € while the common German citizen has just under
19,000 € at his disposal.
In Frankfurt the rents for Class A retail space like Zeil and
Goethestraße increased about €10/SM since 2010. The top
rent on this famous shopping street is now at €240/SM. Due
to the limited availability of retail space at these top
locations, it is expected that the prices will continue to rise
about 2% in 2012. Furthermore, this trend was reflected
through the biggest investment that took place here so far
in 2011. Allianz Versicherungen bought 80% of the project
Skyline Plaza at a price of €290,000,000. When finished,
a large part of the building will contain retail spaces.
In the office market, a slight reduction in the vacancy rate
took place. The rate dropped to 16.6% while rents remained
stable. Overall there was a take-up of 311,000 SM of office
space through the end of October 2011. An additional
258,000 SM are expected to be constructed by the end of
2012.
The biggest lease of 2011 took place at the northern edge
of Frankfurt. Bafin Wertpapier Aufsicht leased 24,200 SM
of office space. A second big lease signing happened at the
Airport. Fraport AG signed a contract for 20,000 SM.
Contact
NAI Global
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Country Data
Area (Sq Mi)
GDP Growth
GDP 2011 (US$ B)
GDP/Capita (US$)
Inflation Rate
Unemployment Rate
Interest Rate
Population (Millions)
50,949
-2.6%
$291.40
$26,025.80
2.2%
14.6%
1.0%
11.197
As of November 2011, the Greek property market faced a
daunting period of reduced consumer spending, rising taxes,
falling property values, a surplus of properties and a frozen
construction industry. Since 2009 the country has faced an
acute economic crisis, the economy has shrunk by 12% to
15% in the last three years, unemployment is at 20% and
the country faces the risk of defaulting on its debts and
being ejected from the Eurozone.
In Athens, there is a falling demand from occupiers as
companies downsize or actually close. Take-up was 50,000
SM. Tenants continue to renegotiate their rents downward
and there remains a short supply of good quality stock. Top
rents are falling towards EUR 20/SM per month.
There is limited interest in the industrial market and an
increasing over supply of product as occupiers downsize.
There are few transactions to report, rental values around
Athens have fallen back to EUR 5/SM per month or lower.
There has been a severe reduction in demand for retail
space with many shops closing (68,000 small business
closures estimated for 2010 and 2011 plus an additional
50,000 expected to close in 2012), especially in secondary
locations with up to 25% vacancy, and many tenants
renegotiating their rents downward by 30% or more. New
shopping center projects are still proceeding although at a
much slower pace. Recent openings including; River West
18,000 SM, Athens Metro Mall 25,000 SM and Athens
Smart Park with up to 80,000 SM on completion.
In the residential sector there is surprisingly still some
recognizable demand for good quality, medium size new
developments in the middle income to upper income
neighborhoods in Athens (price range EUR 3,500
to 4,000/SM), from cash rich investors seeking safer
alternatives. Small new apartments in the central areas also
continue to attract buyers (c. EUR 3,000/SM). However the
general state of the residential property market remains
severely depressed with tens of thousands of unsold
new apartments, and banks are unable to offer finance
opportunities to potential borrowers.
There is a reduced interest from international investors
investing in commercial property due to the risk of Greece
possibly defaulting, but there remains continued, limited
interest from some of the local investment groups and also
high net worth individuals seeking more safe investment
alternatives than stock or money markets.
Frankfurt am Main At A Glance
conversion 0.72 eur = 1 us$ RENT/M 2 /MO US$ RENT/SF/YR
low High low High Vacancy
cItY center offIce
Class A (Prime)
Class B (Secondary)
Average City Center
suburban offIce
Westend Class A (Prime)
EUR 21.00
EUR 12.00
EUR 19.08
EUR 27.00
EUR
EUR
EUR
EUR
38.00
35.00
29.58
34.00
$
$
$
$
32.52
18.58
29.54
41.81
$
$
$
$
58.84 15.50%
54.19 18.20%
45.80 15.80%
52.64 23.00%
Westend Class B (Secondary) EUR 8.50 EUR 21.50 $ 13.16 $ 33.29 23.00%
Suburban Class A (Prime)
EUR 10.00 EUR 19.33 $ 15.48 $ 29.93 22.60%
Suburban Class B (Secondary)
IndustrIal
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
EUR
EUR
EUR
EUR
5.42
3.50
3.50
5.50
EUR
EUR
EUR
EUR
15.50
6.50
6.20
15.75
$
$
$
$
8.39
5.42
5.42
8.52
$
$
$
$
24.00 13.60%
10.06 20.70%
9.60 35.10%
24.39 35.00%
City Center
Neighborhood Service Centers
EUR 120.00
EUR 120.00
EUR
EUR
240.00
240.00
$ 185.80
$ 185.80
$
$
371.61 19.00%
371.61 13.00%
Community Power Center (Big Box)
Regional Centers/Malls
Solus Food Stores
EUR
EUR
EUR
8.00
8.00
7.00
EUR
EUR
EUR
70.00
70.00
16.50
$
$
$
12.39
12.39
10.84
$
$
$
108.39
108.39
25.55
8.00%
8.30%
9.00%
deVeloPment land low/m 2 High/m 2 low/acre High/acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
EUR 1,500.00 EUR 12,000.00 $ 8,430,963.90 $ 67,447,711.16
EUR 230.00 EUR 1,020.00 $ 1,292,747.80 $ 5,733,055.45
EUR 80.00 EUR 245.00 $ 449,651.41 $ 1,377,057.44
EUR 300.00 EUR 1,200.00 $ 1,686,192.78 $ 6,744,771.12
EUR 300.00 EUR 1,200.00 $ 1,686,192.78 $ 6,744,771.12
EUR 300.00 EUR 1,500.00 $ 1,686,192.78 $ 8,430,963.90
Athens At A Glance
conversion 0.72 eur = 1 us$ RENT/M2/MO US$ RENT/SF/YR
low High low High Vacancy
center cItY offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
City Center
Neighborhood Service Centers
Community Power Center (Big Box)
Regional Shopping Centers/Malls
Solus Food Stores
EUR 18.00 EUR 22.00 $ 27.87 $ 34.06 N/A
EUR 17.00 EUR 20.00 $ 26.32 $ 30.97 N/A
EUR 14.00 EUR 18.00 $ 21.68 $ 27.87 N/A
EUR 18.00 EUR 22.00 $ 27.87 $ 34.06 N/A
EUR 13.00 EUR 16.00 $ 20.13 $ 24.77 N/A
EUR 10.00 EUR 14.00 $ 15.48 $ 21.68 N/A
EUR 4.00 EUR 6.00 $ 6.19 $ 9.29 N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
EUR 120.00 EUR 200.00 $ 185.80 $ 309.67 N/A
EUR 10.00 EUR 18.00 $ 15.48 $ 27.87 N/A
EUR 25.00 EUR 35.00 $ 38.71 $ 54.19 N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
deVeloPment land low/m 2 High/m 2 low/acre High/acre
Office in CBD
Land in Office Parks
EUR 1,600.00
N/A
EUR 2,200.00 $
N/A
8,993,028.15 $
N/A
12,365,413.71
N/A
Land in Industrial Parks
Office/Industrial Land - Non-park
EUR 60.00
N/A
EUR 150.00 $
N/A
337,238.56 $
N/A
843,096.39
N/A
Retail/Commercial Land EUR 2,300.00 EUR 3,000.00 $ 12,927,477.97 $ 16,861,927.79
Residential
EUR 600.00 EUR 2,500.00 $ 3,372,385.56 $ 14,051,606.49
2012 Global Market Report n www.naiglobal.com 53